News Column

Capella Revenue and Enrollment Fall in Q4

February 18, 2014

Steve Alexander, Star Tribune (Minneapolis)



Feb. 18--Capella Education Co. beat analysts' estimates by 3 cents a share in the fourth quarter as earnings rose about 16 percent. But revenue declined slightly as total student enrollment decreased.

The company's shares were about 8 percent lower in late morning trading on the Nasdaq Stock Market.

Capella earned $10 million, or 79 cents a share, for the fourth quarter ended Dec. 31. That's up from 68 cents a year earlier and above analysts' expectation of 76 cents a share.

Revenue was $106 million, down 1 percent and just below analysts' expectation of $106.4 million.

"Performance trends stabilized in 2013," Capella CFO Steve Polacek said in a statement. "While the timing of our return to total enrollment growth has likely shifted to the latter part of 2014, we believe moderate annual new enrollment growth and operating margin improvements are achievable in 2014."

For the first quarter of 2014, Capella's new enrollment growth is expected to be "slightly positive compared to the first quarter 2013," the firm said. But total enrollment is expected to drop 1.5 to 2.5 percent. Revenue is expected to be flat to down 1 percent from a year earlier.

The company earned $2.80 per share in 2013, just above the $2.78 analysts had expected and up slightly from $2.76 a share in 2012. Net earnings were $35.2 million, down 3.5 percent, on revenue of $415.6 million, down 1.5 percent.

Steve Alexander -- 612-673-4553

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Source: Star Tribune (Minneapolis, MN)


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